Secretary of Labor obo Louis Silva, Jr. v. Aggregate Industries WRC, Inc. (ALJ decision, December 11, 2017)

Plain-English summary

Aggregate Industries sought sanctions after Louis Silva returned a company cell phone that had been reset to factory settings and no longer contained user data. The company requested dismissal, an adverse inference, limits on Silva's testimony, and reimbursement of its fees and costs. Silva stated that his teenage daughter reset the phone without his knowledge while he was hospitalized and that he had made his safety complaints in person rather than by text or email. Judge Richard W. Manning found no supported showing that Silva intentionally destroyed relevant data, had a reasonably foreseeable preservation duty at the time, or prejudiced the company. He denied sanctions, and the discrimination case continued to the later merits decision.

Decision snapshot

• Cited authority: 30 U.S.C. § 815(c)(2)
• Outcome: Aggregate Industries' motion for spoliation sanctions was denied.
• Key point: Severe spoliation sanctions require evidence of relevant lost material, a preservation duty, culpable destruction, and prejudice, not speculation about a reset phone's contents.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW

COMMISSION

Office of

Administrative Law Judges

721 19 th

Street, Suite 443

Denver, CO 80202-2536

303-844-3577 FAX

303-844-5268

December 11, 2017

SECRETARY

OF LABOR, MSHA on

behalf of

LOUIS SILVA, JR. ,

Complainant

v.

AGGREGATE

INDUSTRIES WRC, INC.,

Respondent

DISCRIMINATION

PROCEEDING

Docket No.

WEST 2017-0482-DM

RM-MD-17-05

Mine: Morrison

Plant

Mine ID:

05-00864

ORDER DENYING RESPONDENT’S MOTION

FOR SANCTIONS FOR SPOLIATION OF EVIDENCE

This matter is before me on a

complaint of discrimination filed by the Secretary of Labor (“Secretary”) on

behalf of Louis Silva, Jr. pursuant to section 105(c)(2) of the Federal Mine

Safety and Health Act of 1977 (“Mine Act”), 30 U.S.C. § 815(c)(2), against

Aggregate Industries WRC, Inc. (“Aggregate Industries”). Respondent filed a Motion

for Sanctions for Spoliation of Evidence. Complainant filed an Opposition to

the motion. [1]

For reasons that follow, I DENY Respondent’s motion.

Louis Silva, Jr., was terminated

from his position as a Quality Control Technician at the Morrison Plant on or

about January 19, 2017. On January 25, 2017, Silva, through separate counsel representing

him in a workman’s compensation proceeding, returned his company-issued cell

phone to Aggregate Industries. The cell phone contained no user data. The missing

user data is the subject of Respondent’s motion and this order.

Respondent argues that Complainant

should be sanctioned by the court because Silva intentionally destroyed

potentially relevant evidence, thereby prejudicing Respondent. Specifically,

Respondent argues that Silva, following his termination, intentionally deleted

the contents of his company-issued cell phone before returning the phone to

Aggregate Industries on January 25. Mot. 1-3. Respondent employed a forensic

investigator who was able to determine that a “factory reset” of the phone,

which deleted and made unrecoverable all user data, was performed on January 24.

Mot. 3. Respondent argues that, based on deposition testimony, Silva’s phone

may have contained information related to his allegations in this matter and

the deletion of those contents prejudices Respondent “because it is unable to

dispute any allegations that may or may not have been supported by the contents

of the cell phone[.]” Id . at 1-2. Spoliation occurred because Silva had

control over the company-issued cell phone, the contents of which are relevant

to his claims and Aggregate Industries’ defenses in this case, and he intentionally

destroyed the information on the phone despite having a reasonably foreseeable

duty to preserve it, as evidenced by his hiring of an attorney as early as

January 19. Mot. 2, 4-5.

Respondent moves this court to utilize

its broad discretion to impose sanctions against Silva for the spoliation. Mot.

6-11. It suggests four forms of sanction: (1) dismissal, (2) an adverse

inference that the phone contained information unfavorable to Silva’s case or

did not contain information corroborating his alleged protected activity, (3)

an order excluding testimony regarding the contents of the phone, and (4) an

order granting fees and costs incurred by Respondent in bringing the subject

motion. Mot. 2, 6-11.

Complainant, in opposition, argues

that Respondent’s motion should be denied for multiple reasons. First,

Respondent did not confer with Complainant prior to the filing of its motion

and, in doing so, failed to comply with Commission Procedural Rule 10(c). Opp.

2-3. Second, Respondent’s allegations lack evidentiary support. Specifically,

Complainant states that the “factory reset” was not a result of intentional

conduct by Silva but, rather, was conducted without Silva’s knowledge by his

daughter while Silva was hospitalized. Opp. 3. Further, Respondent failed to

show how the contents of Silva’s phone are relevant to the case. Opp. 4. Furthermore,

there is no evidence that Silva engaged in any conduct in bad faith or failed

to preserve evidence where a duty was reasonably foreseeable. Opp. 4. Finally,

Respondent has not shown that it was prejudiced and the relief sought is

disproportionate to the facts and unsupported by law. Opp. 5.

I find that sanctions are

inappropriate. I agree with Complainant that Respondent’s allegations lack

evidentiary support. Respondent blindly alleges that Silva intentionally destroyed

relevant evidence on the phone. However, Complainant disputes this and instead,

citing the Declaration of Silva, avers that it was not Silva who conducted the “factory

reset,” but rather his teenage daughter who did so while Silva was hospitalized. [2]

Moreover, Complainant asserts that, while Silva did ask his daughter to remove his

personal photos that were stored on the phone, the “factory reset” was

conducted without his knowledge. Silva’s declaration directly undercuts

Respondent’s argument regarding any intentional deletion of that information by

Silva. See Sec’y of Labor obo Jeffrey Pappas v. CalPortland Company,

et al. , 39 FMSHRC 808 (Mar. 2017) (ALJ) (Denying a motion for sanctions and

noting that the party who failed to preserve certain materials lacked intent).

Respondent’s argument that the destroyed

information was relevant also lacks evidentiary support. I agree with

Complainant that Respondent’s assertions of relevance are based on speculation.

Although the contents of the phone have been erased and it is impossible for

the court to determine what was on the phone, [3]

Silva has declared that the “[a]ll of the safety complaints [he] made at the

mine were made in person, and not through email or text messages. The same is

true with respect to reporting [his] injuries to” Respondent. Opp. Ex. 1 ¶ 8. This

testimony contradicts Respondent’s statement that “Silva appears to allege that

he made some safety complaints” using the phone.” Mot. 5.

Finally, I agree with Complainant

that Respondent “misses the mark on whether Mr. Silva had a duty to preserve

evidence and whether such duty was reasonably foreseeable.” Opp. 4. Parties

have a “duty to preserve evidence in [their] possession when [they] know[] that

the evidence is potentially relevant to litigation before the evidence was

destroyed.” Pappas , 39 FMSHRC at 810 ( citing Leon v. IDX

Systems Corp. , 464 F.3d 951, 959 (9th Cir. 2006)). At the time the phone

was returned to Respondent, Silva had not filed a complaint of discrimination

and had not retained counsel to represent him in anticipation of filing a

complaint. [4]

Moreover, given the lack of evidentiary support regarding potential relevance

of any information on the phone, I find that it is at best questionable whether

there may have been some reasonable foreseeability of a duty to preserve

anything on the phone.

While I do not resolve all disputes of fact in

this order, the unsupported allegation of Respondent that Silva intentionally

destroyed relevant information that he had a duty to preserve lacks evidentiary

support and is contradicted by evidence presented by Complainant. I find that

the requested sanctions are not warranted because Respondent’s allegation that

there was information on the phone that was relevant to this case is

speculative and there is no evidence that Silva intentionally deleted relevant

data or instructed his daughter to do so. In addition, it is not at all clear

that Silva had a duty to preserve data on the phone or whether such a duty was

reasonably foreseeable at the time the data was deleted. Finally, Respondent

failed to show that it was prejudiced by the deletion of the data. Assuming,

for that sake of argument, that Silva did make safety complaints using the

phone, such information would be on the phone of the management employee(s) to

whom the complaints were made. Respondent’s motion is DENIED .

/s/

Richard W. Manning

Richard W. Manning

Administrative

Law Judge

Distribution:

Matthew M. Linton, Ogletree, Deakins, Nash, Smoak & Stewart, PC, 1700 Lincoln

Street,

Suite 4650,

Denver, Colorado 80203

Karen W. Bobela, Esq., Office of the Solicitor, U.S. Department of Labor, 1244 Speer

Boulevard, Suite 515, Denver, CO 80204

David

Lichtenstein, Esq., Law Office of David Lichtenstein, LLC, 1556 Williams

Street, Suite 100, Denver, CO 80218   

RWM

[1]

Louis Silva is also represented by separate counsel in this proceeding. Complainant’s

opposition was filed jointly by counsel for the Secretary of Labor and counsel

for Silva.

[2]

The Secretary alleges that Respondent failed to confer prior to the filing of

its motion. Had Respondent done so it may have learned of the Secretary’s

planned response, and the parties may have been able to resolve the issues on

their own without the involvement of this court.

[3]

As noted by Complainant, however, Respondent may be able to obtain text

messages and emails that were sent by Silva by examining the cell phones of other

employees.

[4]

Silva had retained counsel to represent him in a separate worker’s compensation

proceeding, who was not the same private attorney representing him in the

current proceeding.